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As you slowly return to the grind after the holiday season, you may have a massive credit card bill sitting at your table – thanks to all the Christmas shopping, travelling, and festivities. 

So, what do you do next? 

Carry on like nothing happened, making the minimum repayments on your cards, and letting the debt pile? Or, take some active measures to boost your savings, and repay your debts in a timely manner?

If you prefer the latter, here are seven hacks that will help you cut down your expenses and grow your savings faster.

 

1. Become a conscious shopper

If you feel bored or anxious, it’s easy to resort to online shopping for instant retail therapy. However, the joy of impulse shopping is usually short-lived. Instead of buying what you don’t need and blowing your budget, it’s better to find other means to distract yourself, like reading a book, meeting up with a friend, or even taking a jog around the block.

For those who tend to overspend at grocery stores, downloading an app like GrocerEaze on your smartphone could help prepare your grocery lists in advance and also track your spending as you shop. 


2. Give up on unnecessary subscriptions

 Do you have an expensive gym membership that you rarely use? If multiple subscriptions are weighing down your budget, take some time to go through your account statement and check for subscriptions that you no longer use to opt-out of them and save money instantly.

A subscription detox may seem challenging at first, but keep your eyes on the prize, and you’ll probably feel grateful for all the extra cash you’ll save in a few months. 

 

3. Pay your bills on time to avoid late fees and interest charges

To keep your financial health in check, it’s essential to track all your payment dates or set up automatic outflows to make sure your bills are paid on time. 

Paying your bills on time has several benefits. It helps you avoid late payment fees and maintains your credit score. A good credit score is important because it enables you to qualify for competitive rates on home loans and other credit products, potentially saving you more money in the future. On the other hand, late utility payments, or a missed repayment can stay on your credit report for several years and impact your credit score adversely. If you forget to pay your credit card bills on time, you’ll also incur high-interest charges that can potentially plunge you into a cycle of debt.

 

4. Energy efficient is money efficient

Switching to energy-efficient appliances will significantly cut down your energy bills and reduce your carbon footprint. You could start by using a part of your savings or tax refund to change all the light bulbs in your home to LED bulbs. This will save you a lot of money over time, as LED bulbs consume less energy, don’t heat up, and last for years.

If you are committed to reducing your energy bills and doing your bit for the environment, it’s also possible to refinance your mortgage to cover the costs of a solar power system for your home.

 


5. Automate your savings

Automating your savings by setting up recurring, direct debits from the bank account where you receive your salary to your savings account can help you boost your savings. Automated deposits work psychologically by making it difficult for you to spend money – because you don’t see it in your account once you receive your salary.

Another simple way to increase your savings is by setting up a bank account with a round-up feature. If you opt for this feature, all your purchases are rounded up to the next dollar (or $5 if you choose), and the change goes directly to your savings account. For instance, if you buy a coffee for $3.65, 35 cents will be rounded up from that transaction and credited to your savings account.

 


6. Stop paying the lazy tax

Did you know that Australians pay over $3.6 billion in lazy tax each year by not shopping around for the best deals offered by various credit providers, insurance companies, and utility providers? 

Here’s a little secret – new customers usually get better deals than existing customers. Therefore, it’s worth comparing deals from different service providers to check whether you can land a better rate on anything from your insurance premium to your broadband connection.


7. Refinance your home loan

Interest rates on home loans have been relatively low in the past couple of years. Therefore, it’s worth revisiting your home loan if you haven’t in the past few years to determine whether you are paying more than the market average. 
Refinancing your home loan could also be an option for consolidating multiple debts under a single, low-interest rate loan. However, whether or not this is the right strategy for you will depend on your circumstances, such as the size and length of your outstanding debts. You could speak with a broker to understand your options and increase your chances of finding a competitive home loan deal to save more money on your mortgage. 

 

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